'Millions' of loan payments missed in 2007

20 June 2007

Thousands of loans are going unpaid each day in the UK as consumers begin to feel the sting of recent Bank of England rate rises.

Over 1.3 million repayments on personal loans have been missed over the last six months, according to MoneyExpert.com.

And the financial website claims that the squeeze on Britons' finances is set to get worse as the level of missed payments in the UK has risen from two per cent in 2006 to three per cent in the first half of 2007.

Sean Gardner, chief executive of MoneyExpert.com, said: "This is yet another warning of real financial distress and a sign that finances are being stretched to the limit by recent interest rate rises.

"The concern has to be that people are missing repayments on unsecured loans because they believe there's not as much at stake as missing a mortgage repayment."

However, experts warned that missing repayments is not a healthy way to manage finances, and that people should instead aim to utilise the wide range of financial products and advice available to help them deal with their debt problems.